On Our Radar

On Our Radar

As government shutdown looms, taxman still knocks

WASHINGTON (Reuters) - As the U.S. government moves to the brink of a shutdown with budget talks stalled, taxpayers should remember one thing as tax day nears: tax collection may be considered "essential."

Internal Revenue Service Commissioner Douglas Shulman last week told a congressional hearing he was in talks with the White House budget agency about contingency plans in the event of a government shutdown.

Taxes are due this year on April 18.

Lawmakers and the Obama administration continued talks on Tuesday to avert a shutdown, racing against expiration of a temporary government funding measure that ends this Friday, April 8.

When the IRS Commissioner was asked about the potential for a shutdown last week, talks seemed productive.

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In prior shutdowns, the most recent of which occurred in 1995 and 1996, checks from taxpayers were collected - but refunds stopped. Still, prior shutdowns occurred during the months of November and December through January, not the tax-frenzied month of April.

An IRS spokeswoman could not speculate on how the agency would handle a shutdown this time.

Though refunds could be stalled, a 2011 Congressional Research Service report listed tax collection as an "essential" activity.